Gas Market
Gas prices strengthened on Thursday, with the front month rising 1.98p to 81.50p/therm. Norwegian supply is expected to recover by the weekend with around 100mcm returning, though an unplanned outage at Troll has reduced flows via Europipe by 22mcm until the 20th. Prompt contracts also gained, as the day ahead climbed 2.45p, or 2.6%, to 81.05p/therm amid lower wind generation driving higher gas for power demand. On the policy side, the EU is preparing another sanctions package against Russia, but gas is unlikely to be targeted as Hungary and Slovakia would oppose this. A proposal for a full phase-out by 2027 is contingent on the EU labelling it as a trade regulation rather than a sanction, enabling the measure to be passed with a majority rather than unanimous vote. In a setback to the proposal, the EU’s legal team deemed the measure a “disguised sanction” open to legal challenge, casting doubt on whether the accelerated phase out of remaining Russian gas will be possible in the near term.
Power Market
Power prices advanced on Thursday in line with strength in the gas market. The front month rose £1.55 to £76.90/MWh, while lower temperatures and forecasts for wind output to drop to 8.1GW on Friday provided additional support. The day ahead contract surged 52.72% to £78.50/MWh, reflecting tighter fundamentals and reduced renewable availability.
Carbon prices also firmed, recovering ground after Wednesday’s late sell-off. Strong early momentum saw both gas and carbon moving higher together, with the Dec-25 EUA contract settling at €78.84/tonne. This marked its highest close since mid-February.
Oil Market
Oil prices moved lower on Thursday, with sentiment overshadowed by renewed concerns about the U.S. economy. Brent front month fell 51c, or 0.8%, to settle at $67.44/bbl. The Federal Reserve had cut interest rates by a quarter of a percentage point on Wednesday, its first reduction this year, in response to weakness in the labour market. While lower rates typically encourage fuel demand by reducing borrowing costs, traders were more focused on the broader signs of slowing U.S. growth, which dampened any potential upside for crude. On the supply side, oil prices found support from reports that Ukrainian drones had struck a major oil processing and petrochemical complex in Russia.
Markets This Morning
The NBP gas market is finely balanced this morning, with near-curve contracts down an average of 0.63p/th. The unplanned outage at the Troll field has reduced flows by around 45mcm/day, though overall Norwegian exports have increased to 246mcm/day, softening the impact. European storage remains healthy at 81% capacity, offering reassurance for Winter 25, though traders are cautious ahead of forecasts pointing to a sharp drop in temperatures from 21 September. Oil prices are also weaker, as concerns over U.S. fuel demand outweighed expectations that the Federal Reserve’s first rate cut of the year would support consumption. Brent crude is trading 40c lower at $67.04/bbl.
19 September 2025
